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File this under: Duh.
Women spend about 85% of the disposable income in the United States, so it's always shocking to us when company execs wake up one day and realize that their businesses have suffered because they've neglected to take half the population—the spending half—into consideration, ever.
According to the Wall Street Journal, Best Buy has only just noticed that women buy stuff, too.
Best Buy's customers and worker are overwhelmingly male, a vestige from its days as a seller of speakers and stereo equipment. While Best Buy estimated earlier this year that it commanded roughly 22% of U.S. consumer electronics sales, its share of sales to women was just 16%, and only 31% of store workers are women....
Best Buy reported on Tuesday nearly flat fiscal first-quarter profits of $155 million compared to $153 million a year ago, and its stock plunged 6%, or $2.49, to $38.56 in 4 p.m. trading on the New York Stock Exchange. Results show the retailer's challenge after the temporary boost from the 2009 liquidation of former rival Circuit City Stores.
But while sales of televisions and video games were down for the quarter ended May 29, sales of cell phones, appliances and laptops are increasing. All are products where Best Buy reports rising market share among female shoppers.
In an effort to reach out to female spenders, the company has created a network of what they call "Women's Leadership Forums"—basically what amounts to groups of market research participants all over the country.
The groups helped increase appliance sales by suggesting that showrooms be redesigned to resemble kitchens. A group in Wisconsin created a customer loyalty plan that allowed women there to donate loyalty points to schools.Still, despite making shop floors more attractive to women and the workplace better for women employees, and even though sales were increasing, execs didn't get it. "People thought it was some Oprah book club," former exec Julie Gilbert told the Journal, who's since left to consult with other companies.
The groups led to local businesswomen advising on regional strategy, and others that help women workers balance family and work demands. Most recently, they spawned teenage consultants who help the retailer sell phones and videogames to young people.
"BlackBerries: those just aren't cute," said Taylor Brittian, 14, who recommended spotlighting iPhones and colorful phone cases in the front of Atlanta's Best Buy Mobile stores. Another teen idea: sanitizer beside the videogame test kiosks.
The company is, now, ostensibly supportive of the idea and are implementing expanded floor space and new retail categories—such as used video games—that appeal to women, especially moms.
Let's see how this goes—the company tried a similar tactic during holiday season 2006.
nstead of hitting high-tech hysteria at Best Buy (BBY) this holiday season, shoppers may notice a softer, more personal atmosphere. Music is quieter. Lights are lower. Salespeople talk to customers about their lifestyles, what they want the technology to do for them — or the person getting the holiday gift — and how they want it to fit into their homes, offices, cars. In some stores, a "personal shopping assistant" will help with everything from designing a home entertainment system to picking a digital camera. If you need more help, one of thousands of its "Geek Squad" techies will come to your home to hook stuff up.We're not sure the changes stuck the first time around.
· Best Buy Tests New Appeals to Women [WSJ]